Thursday, January 17, 2013

Ultimately, the government will need to raise the debt ceiling. In fact, if we don’t reform entitlement spending growth we will need to raise it again many times. There is no other option. Without changes, spending as a share of GDP is projected to almost double over the next 30 years (from 23 percent today to 40 percent in 2045). The gap between revenue and spending will grow considerably, causing the public debt to grow from 70 percent of GDP today to about 250 percent by 2045. So in a sense this fight over raising the debt ceiling is merely symbolic if Republicans’ greatest demand is nickel-and-dime discretionary spending cuts.